Panera Bread Wants to Be Everywhere. Panera’s move into dinner could attract new clients. Recently, Panera Bread has announced several new initiatives targeted at expanding its reach-efforts which will continue to unfold as Panera works to gain access to more locations and serve more customers at more occasions.
“This brand has an incredibly high emotional connection with our target customers,” says Dan Wegiel, the company’s EVP and chief growth and strategy officer. “That’s something that is a massive asset for people and we want to keep them.”
Having a wide appeal among consumers and deep relevance among loyal fans, Panera executives see lots of runway for future expansion and a good amount of chances to further ingrain the company into customers’ daily lives.
Most of the brand’s recent evolution has occurred since JAB Holding Company acquired Panera in 2017 for $7.5 billion. Since then, the fast-casual giant has created big news: In April, it rolled out a new slate of breakfast menu items targeted at winning share from competitors who frequently offer frozen, microwaved food items during the breakfast daypart. That effort included a revamped coffee program that mirrors the standard and technology offered at big coffee houses. In June, the brand launched an exam of the dinner menu which includes artisan flatbreads, bowls and hearty side items like sweet potato mash. And just in late August, nearest Panera Bread turned more heads because it finally embraced third-party delivery partners after many years of sticking with its in-house delivery program.
So, what exactly do the collective moves inform us about where Panera is going?
“The strategic thread that holds all of the things together is that this: this brand features a very unique opportunity within our minds inside the food and restaurant space to have broad relevance to your fairly broad set of target customers,” Wegiel says. “It’s one of many few brands that operates across all dayparts, all week parts and multiple channels of access.”
While those changes came after JAB’s acquisition, he says, the European conglomerate empowered those efforts, not mandated them.
“JAB has a very explicit and clear philosophy they believe individual companies and brands should certainly shape their destiny and destination,” he says. “Unlike various other investment firms they don’t can be found in with a playbook and say here’s ways to create value or say here’s the portfolio and here’s where we can create synergies …That’s greatly the antithesis of how they operate.”
Panera and third-party delivery? It fits rapid casual’s goal to meet customers everywhere.
Still, Panera has experienced managed to lean on the expertise of sister brands underneath the JAB umbrella-and the other way round. The business owns several coffee concepts, including Peet’s Coffee and Caribou Coffee. That was useful when researching approaches to revamps Panera’s coffee offerings, Wegiel says. Even so, JAB urged Panera to strengthen its self-branded coffees, not adopt the banner of another JAB brand.
Moving forward, Panera wants to create more access points in to the brand. To that particular end, the organization will expand traditional and nontraditional stores. Wegiel wouldn’t share specific store growth projections but says there exists “ample room” to add both international and domestic units. Likewise, Panera goes deeper on its lines of consumer packaged goods. Customers can currently find salad dressings, soups, breads, and coffee in supermarket aisles. But the brand thinks it may expand both the number of products and the quantity of distribution points.
“CPG in our minds could be a significant lever of brand new growth,” he says. “I think we’re just scratching the surface.”
Panera is definitely a holdout with regards to the next-party delivery services who have transformed much of the restaurant space. The organization has offered in-house delivery for years. Nevertheless in late August, the chain announced new partnerships with DoorDash, Grubhub and Uber Eats that expanded delivery choices across 1,600 of its 2,300 approximately stores. The company believes adopting those services will help recruit new clients.
“We’ve experienced delivery for your better a part of five years,” Weigel says. “We realized and heard through the aggregators there was a complete segment of customers that wanted Panera, however their primary source or delivery was the aggregators and we weren’t there.”
Whether in delivery, a reimagined breakfast menu or CPG options, Panera is attempting to reach customers across multiple dayparts and occasions.
“We know there’s tremendous interest in the company, some of which is quite pent up,” Weigel says. “There are areas consumers want us where we’re not.”
“While they could possibly possess some incremental business at dinner time, it’s not going to be overpowering. Once these brand identities are established and known, it merely takes forever to go the needle.” – John Gordon, principal and founding father of Pacific Management Consulting Group.
While Panera accelerates change, don’t expect any wholesale transformation. The business plans to stay with its core brand identity that targets clean ingredients and wellness, as well as keeping its more indulgent bakery and menu items.
“Wellness is not just about eating healthy. It plays a part … Somebody that is trying to consume well is generally trying to balance things,” Wegiel says. “We offer optionality because wellness is about completeness in the balance of fulfillment.”
Some of Panera’s moves-such as the reimagined breakfast and coffee program-look more routine than transformational to John Gordon, principal and founding father of Pacific Management Consulting Group.
“Every good operator should be doing that,” he says.
He views Panera’s flirtation with dinner, though, as being a bolder move. He recalled the brand’s 2006 introduction of the Crispani, a handmade pizza product available only inside the evenings. That offering was intended to push the brand further in to the dinner daypart but low sales caused Panera to tug the pizzas in 2008.
“It’s just tough because Panera was known and still is known as a soup, salad, sandwich and breakfast place,” Gordon says. “Dinner is a substantial daypart for them, although not the top of mind daypart.”
To ramp up evening sales, he believes Panera must launch a flagship dinner product. But he thinks the brand’s bakery-cafe identity will always be intact.
“While they could possibly have some incremental business at dinner time, it’s never going to be overpowering,” he says. “Once these brand identities are established and known, it just takes forever to maneuver the needle.”
Like several privately held concepts, Panera’s financial performance is difficult to find out since its purchase by JAB. But Gordon says the manufacturer still looks strong. It’s a successful operator with a widespread appeal. And Panera enjoys white ypbonx to cultivate its footprint domestically and internationally.
“They have solidified their position in the usa within the last 10 years without a doubt,” he says. “I have a lot of respect for Panera being an operator. In several restaurant brand surveys, Panera shows up high and it has a really strong company operation and franchisee operation.”